A Right of Light is an easement that entitles landowners and tenants to receive natural light through apertures in buildings. It enables the owner of a neighbouring impaired property to file a claim against a proposed construction. Insurance can give developers financial security should a Right of Light claim be upheld, and both the severity and volume of such claims are rising in the wake of the Covid-19 outbreak.
The drivers
With so many of us forced to spend more time at home, even a slight reduction in light may be noticeable and more important, given the vital role light plays on people’s health and wellbeing.
Traditionally, objections to lighting levels in rooms like bedrooms and kitchens would have been rare. But, with increased working from home, even small reductions in the level of light can provoke objections. Right of Light consultants generally deem that a third party has sustained injury if the area of a room that enjoys natural light is reduced by more than 50%. With the additional time available to them thanks to a reduced need to commute, people working from home are carrying out their own research and becoming increasingly aware of these rights.
This growing awareness, compounded by the current economic climate and the associated upward pressure on the cost of materials, labour and inflation, has meant insurers are seeing an increase in both the volume and severity of Right of Light claims. All of which has driven insurers to apply increased premiums to cover the rising cost of potential losses.
Recommendations
Realistically, no property developer can afford to ignore the risk of Right of Light claims from third parties. We would encourage all beneficiaries of Right of Light policies to review their limits of indemnity, to ensure that the cover remains adequate, and takes account of the increased cost of claims. For example, one leading insurer recently advised us that they have seen Right of Light claims surpass the figures in Right of Light reports by over 300% of the budgeted figures, highlighting the importance of accurate coverage.
For new risks, insurers are also scrutinising these reports to make sure their rating properly reflects the risk being transferred. This underlines the vital importance of ensuring that a trusted and experienced Rights of Light surveyor is selected. This provides peace of mind and reassurance that the limit of cover suggested is adequate and will remain so for the duration of the policy.
Our team have many years of experience, excellent market relationships with underwriters, and are committed to securing the best terms for our clients in an increasingly difficult market. We would be delighted to work with you on any of your projects. There is no financial cost to you to obtain a Right of Light quotation. Costs will only be incurred if you decide to purchase the insurance.
For more information on Rights of Light insurance, please contact Marcus Potter directly, alternatively, visit our Contingent & Special Risks (opens a new window) page.
